Increasing Enrollment and Coverage Ages for Children's Insurance
Expanding Coverage for Dementia and Caregiving in Senior Insurance
[Asia Economy Reporter Oh Hyung-gil] Medical expenses for children and the elderly have been rapidly increasing. The insurance industry is offering customized insurance products to cover the risks caused by frequent illnesses in children and the elderly.
According to the Life Insurance Association, medical expenses for those aged 19 and under and those aged 65 and over have recently increased significantly, but the proportion of life insurance subscriptions in these age groups is lower compared to other age groups.
According to the Health Insurance Review & Assessment Service, the total medical expenses in South Korea amounted to 86.0277 trillion KRW in 2019, an increase of 118.2% compared to 10 years ago. Among them, medical expenses for the elderly aged 65 and over surged by 190.1% to 34.9293 trillion KRW during the same period.
In particular, medical expenses for ophthalmology, otolaryngology, and dermatology reached 3.6 billion KRW, increasing by 39.7% compared to 2016. It is analyzed that patients visiting local clinics have been continuously increasing due to frequent eye, respiratory, and skin diseases caused by fine dust.
Although the risk of various diseases is expanding, those aged 19 and under and those aged 65 and over are insufficiently prepared for this. Medical expenses for those aged 19 and under account for 8.8% of the total, but life insurance subscriptions account for only 1.5% of the total. For those aged 65 and over, medical expenses accounted for 40.6% of the total, but life insurance subscriptions remained at 10.0% of the total.
The life insurance industry advises checking the characteristics of insurance exclusively for children and the elderly and preparing for risks by subscribing to related products.
Children’s insurance provides high diagnosis payments for cancers such as leukemia and bone marrow cancer, which require high treatment costs. Coverage is also being strengthened in response to environmental and trend changes such as fine dust and smartphones. Products that compensate for crimes against children such as traffic accidents, abduction, kidnapping, and assault have also been launched.
Notably, it is worth paying attention to the fact that each life insurance company allows subscription up to age 30, and the insurance period can be chosen between coverage until age 30 or until age 100 in children’s insurance.
Elderly Insurance, Easy Underwriting Available for Those with Pre-existing Conditions and People in Their 80s
Samsung Life Insurance’s 'Dream Tree Children’s Insurance' targets ages 0 to 15 and provides comprehensive coverage for multiple childhood cancers, cerebrovascular diseases, ischemic heart diseases, and hospitalization, surgery, and outpatient treatment up to age 30. It also offers growth care services including growth plate support tests (for the bottom 25% in height). Customers can choose between a 20-year term or coverage until age 30, and a ‘maturity congratulatory payment’ is given at maturity for marriage or college entrance expenses.
Hanwha Life Insurance’s 'Life Plus Adult Insurance' has expanded the eligible subscription age up to 30. It offers personalized plans through 72 special contracts and provides coverage up to age 100. The 90-day waiting period for cancer has been removed, allowing full coverage immediately after subscription.
Kyobo Life Insurance’s 'Kyobo Our Child’s First Insurance' covers diseases common in infancy and adolescence up to age 30, and upon renewal, covers cerebrovascular hemorrhage, acute myocardial infarction, and more up to age 100. It also adds coverage for atopic dermatitis, allergic rhinitis, myopia, attention deficit hyperactivity disorder (ADHD), and precocious puberty through special contracts.
Shinhan Life Insurance’s 'Sincere Child Love Insurance' covers five major diseases?cancer diagnosis, cerebrovascular hemorrhage, acute myocardial infarction, end-stage renal failure, and end-stage chronic pulmonary disease?up to age 100 with coverage of 50 million KRW (25 million KRW if insured for less than one year).
For elderly insurance, there is a trend toward easy underwriting allowing people with pre-existing conditions such as hypertension or diabetes and those in their 60s to 80s to subscribe. It also provides diagnosis fees for long-term care conditions such as dementia, living expenses, and caregiving services.
It is explained that one insurance can efficiently prepare for various risks that change with age by covering major adult diseases such as cancer before age 70 and dementia thereafter.
An official from the Life Insurance Association said, "In May, the month of family, on Children’s Day and Parents’ Day, you can express your love for your family with the gift of insurance," adding, "Accordingly, life insurance companies are introducing children’s and elderly insurance products that meet consumer demand."
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